SPECIAL REPORT SPECIAL REPORT
Thinking about potential surprises is a good way to think about risk. For example, if you owned Tesla stock, you enjoyed a huge gain last year... But stocks that soar like that – especially those of companies that consistently lose money – routinely soar just before they plummet. It would likely surprise all Tesla shareholders if the stock fell 50% this year. I’m not saying my surprise will happen... That would be a prediction. I’m saying investors should be prepared for a wide range of outcomes at all times... including extremes represented by my list of Top 10 Surprises.
crash. And their enthusiasm only grew as the gains stacked up to finish 2020. The lockdowns brought many first-time investors into the market. And we have an army of new investors that see the stock market as a “can’t lose” proposition. To be clear, this is not a good thing for the long term. But in the short term, it’s the fuel that can propel stocks to unthinkable heights. The last time we saw similar market enthusiasm was during the dot-com boom of the late 1990s. Investors didn’t think they could lose back then either. So they bought hand over fist, fearing they’d miss out if they didn’t. That helped propel the Nasdaq up 39.6% in 1998. And it followed that rise with an 85.6% gain in 1999. It was a furious blow-off top that ended nearly two decades of general market gains. And I expect we’re in the middle of a similar move today. The Nasdaq soared 43.6% in 2020. And I believe we could see a similar move this year, potentially pushing it to a peak of 20,000, before this Melt Up ends. I’m not saying my surprise will happen... That would be a prediction. I’m saying investors should be prepared for a wide range of outcomes at all times...
DR. STEVE SJUGGERUD TRUE WEALTH
My big prediction for 2021 is a continuation of the major theme I’ve shared for years... The Melt Up in U.S. stocks will continue this year. And importantly, it’ll push the Nasdaq Composite Index to a peak of 20,000. With current levels of around 13,200, that’s a gain of roughly 50%. And while that might seem crazy given the year we just finished, it’s not that hard to believe at all in the context of a stock market Melt Up. Like it or not, euphoria is driving stocks right now. Investors became emboldened as we came out of the COVID-19 stock market
American Consequences
95
Made with FlippingBook - Online catalogs